Regulon — CA-SB-7 · CA SB 7 (Automated Decision Systems in the Workplace)

2024-12-02 introduced Introduced. Read first time. To Com. on RLS. for assignment. To print.

2025-01-29 committee referral Referred to Com. on RLS.

2025-03-06 committee referral From committee with author's amendments. Read second time and amended. Re-referred to Com. on RLS.

2025-03-19 committee referral Re-referred to Coms. on L., P.E. & R. and JUD.

2025-04-09 committee referral From committee: Do pass and re-refer to Com. on JUD. (Ayes 4. Noes 1. Page 739.) (April 9). Re-referred to Com. on JUD.

2025-04-30 committee passage From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 11. Noes 2. Page 937.) (April 29).

2025-05-01 committee referral Read second time and amended. Re-referred to Com. on APPR.

2025-05-23 committee passage From committee: Do pass. (Ayes 5. Noes 1. Page 1187.) (May 23).

2025-05-23 chamber passage Read second time. Ordered to third reading.

2025-06-09 committee referral Referred to Coms. on L. & E., P. & C.P., and JUD.

2025-06-19 committee referral From committee with author's amendments. Read second time and amended. Re-referred to Com. on L. & E.

2025-06-26 committee referral From committee: Do pass and re-refer to Com. on P. & C.P. (Ayes 5. Noes 0.) (June 25). Re-referred to Com. on P. & C.P.

2025-07-09 committee referral From committee with author's amendments. Read second time and amended. Re-referred to Com. on P. & C.P.

2025-07-17 committee referral From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 4.) (July 16). Re-referred to Com. on APPR.

2025-08-29 committee passage From committee: Do pass as amended. (Ayes 10. Noes 4.) (August 29).

2025-09-02 amendment Read second time and amended. Ordered to second reading.

2025-09-03 chamber passage Read second time. Ordered to third reading.

2025-09-05 amendment Read third time and amended.

2025-09-05 chamber passage Ordered to third reading.

2025-09-12 chamber passage Assembly amendments concurred in. (Ayes 28. Noes 9. Page 2988.) Ordered to engrossing and enrolling.

2025-09-23 chamber passage Enrolled and presented to the Governor at 2 p.m.

2025-10-13 executive action Vetoed by the Governor.

Summary

Imposes transparency, use restrictions, and human oversight obligations on employers using automated decision systems (ADS) for employment-related decisions in California. Requires pre-deployment written notice to affected workers describing the ADS, its data inputs, and worker rights, as well as post-decision notice when ADS output primarily drives discipline, termination, or deactivation. Prohibits sole reliance on ADS for discipline, termination, or deactivation and requires human review when ADS output is the primary basis. Prohibits using ADS to infer protected status, retaliate against workers exercising legal rights, or collect undisclosed worker data. Enforced by the Labor Commissioner and public prosecutors with $500 civil penalties per violation, injunctive relief, punitive damages, and attorney's fees. Collective bargaining agreements may waive coverage if they contain explicit protections from algorithmic management. The bill passed the legislature but was vetoed.

Enforcement & Penalties

Enforcement Authority

The Labor Commissioner enforces this part, including investigating alleged violations, ordering temporary relief, issuing citations, and filing civil actions under Labor Code Sections 98.3, 98.7, 98.74, or 1197.1. Alternatively, a public prosecutor may bring a civil action pursuant to Labor Code Chapter 8 (commencing with Section 180) of Division 1. No private right of action is created — enforcement is agency-initiated or through public prosecutor action. No cure period or safe harbor is specified.

Penalties

Civil penalty of $500 per violation. In civil actions brought by the Labor Commissioner or a public prosecutor, the petitioner may seek appropriate temporary or preliminary injunctive relief, punitive damages, and reasonable attorney's fees and costs. Statutory civil penalties do not require proof of actual harm.

Who Is Covered

"Employer" means any person who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, benefits, other compensation, hours, working conditions, access to work or job opportunities, or other terms or conditions of employment, of any worker. This shall include all branches of state government, or the several counties, cities and counties, and municipalities thereof, or any other political subdivision of the state, or a school district, or any special district, or any authority, commission, or board or any other agency or instrumentality thereof.

"Employer" includes a labor contractor of a person defined as an employer under paragraph (1).

What Is Covered

"Automated decision system" or "ADS" means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including a score, classification, or recommendation, that is used to assist or replace human discretionary decisionmaking and materially impacts natural persons. An automated decision system does not include a spam email filter, firewall, antivirus software, identity and access management tools, calculator, database, dataset, or other compilation of data.

Compliance Obligations 15 obligations · click obligation ID to open requirement page

H-01 Human Oversight of Automated Decisions · H-01.3 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1522(a), (c), (e)

Plain Language

Employers must provide a written pre-use notice to any worker (or their authorized representative) who will foreseeably be directly affected by an ADS used for employment-related decisions other than hiring. The notice must be delivered at least 30 days before initial deployment, by April 1, 2026 for systems already in use, or within 30 days of hiring a new worker. The notice must be a standalone, plain-language communication in the worker's routine language, and must describe the types of decisions affected, the categories and sources of worker data collected, key parameters that disproportionately affect ADS output, the ADS creator, any applicable quotas, and the worker's right to access and correct their data. This is a proactive pre-deployment obligation — employers cannot wait for workers to ask.

Statutory Text

(a) An employer shall provide a written notice that an ADS, for the purpose of making employment-related decisions, not including hiring, is in use at the workplace to a worker who will foreseeably be directly affected by the ADS, or their authorized representative, according to the following: (1) At least 30 days before an ADS is first deployed by the employer. (2) If the employer is using an ADS to assist in making employment-related decisions at the time this title takes effect, no later than April 1, 2026. (3) To a new worker within 30 days of hiring the worker. (c) A written notice required by this section shall be all of the following: (1) Written in plain language as a separate, stand-alone communication. (2) In the language in which routine communications and other information are provided to workers. (3) Provided via a simple and easy-to-use method, including, but not limited to, an email, hyperlink, or other written format. (e) A notice issued pursuant to subdivision (a) shall contain the following information: (1) The type of employment-related decisions potentially affected by the ADS. (2) A general description of the categories of worker input data the ADS will use, the sources of worker input data, and how worker input data will be collected. (3) Any key parameters known to disproportionately affect the output of the ADS. (4) The individuals, vendors, or entities that created the ADS. (5) If applicable, a description of each quota set or measured by an ADS to which the worker is subject, including the quantified number of tasks to be performed or products to be produced, and any potential adverse employment action that could result from failure to meet the quota, as well as whether those quotas are subject to change and if any notice is given of changes in quotas. (6) A description of the worker's right to access and correct the worker's data used by the ADS. (7) That the employer is prohibited from retaliating against workers for exercising their rights described in paragraph (6).

G-01 AI Governance Program & Documentation · G-01.3 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1522(b)

Plain Language

Employers must maintain and keep current an inventory list of all automated decision systems in use. This is an ongoing recordkeeping obligation — the list must be updated whenever an ADS is added or removed. The statute does not specify the format or content of the list beyond identifying systems currently in use, nor does it require the list to be published publicly or submitted to regulators.

Statutory Text

(b) An employer shall maintain an updated list of all ADS currently in use.

H-01 Human Oversight of Automated Decisions · H-01.3 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1522(d)

Plain Language

When an employer uses an ADS to make hiring decisions for a particular position, the employer must notify each applicant upon receiving their application. Notification may be delivered via automated reply or included in the job posting itself. Unlike the pre-deployment notice to existing workers in § 1522(a), this hiring-specific notice does not require the detailed content items (data categories, quotas, vendor identity, etc.) specified in § 1522(e). This applies only where the employer will actually use an ADS for the position the applicant is applying for.

Statutory Text

(d) An employer shall notify a job applicant upon receiving the application that the employer utilizes an ADS when making hiring decisions, if the employer will use the ADS in making decisions for that position. Notifications may be made using an automatic reply mechanism or on a job posting.

S-02 Prohibited Conduct & Output Restrictions · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1524(a)(1)-(3)

Plain Language

Employers are prohibited from using an ADS in three specific ways: (1) to prevent compliance with or violate any labor, employment, health and safety, or civil rights law; (2) to infer a worker's protected class status under FEHA (race, sex, disability, etc.); or (3) to identify, profile, predict, or retaliate against workers for exercising legal rights. The prohibition on inferring protected status is particularly notable — it bans the use of ADS to derive protected characteristics even if those characteristics are not directly used in a decision. The anti-retaliation prohibition here applies to ADS-facilitated profiling and prediction of workers who exercise rights, complementing the broader anti-retaliation provision in § 1530.

Statutory Text

(a) An employer shall not use an ADS to do any of the following: (1) Prevent compliance with or violate any federal, state, or local labor, occupational health and safety, employment, or civil rights laws or regulations. (2) Infer a worker's protected status under Section 12940 of the Government Code. (3) Identify, profile, predict, or take adverse action against a worker for exercising their legal rights, including, but not limited to, rights guaranteed by state and federal employment and labor law.

D-01 Automated Processing Rights & Data Controls · D-01.4 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1524(b)

Plain Language

Employers may not use an ADS to collect worker data for any purpose beyond what was disclosed in the pre-use notice required by § 1522. This is a purpose limitation — data collection through the ADS is constrained to what was described in the mandatory notice. Because 'worker data' includes inferred and derived information, this restriction extends beyond directly collected data to encompass any data the ADS generates about workers. If an employer wants to collect new categories of worker data via the ADS, they must first update and re-issue the required notice.

Statutory Text

(b) An employer shall not use an ADS to collect worker data for a purpose that is not disclosed pursuant to the notice requirements in Chapter 2 (commencing with Section 1522).

H-01 Human Oversight of Automated Decisions · H-01.6 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1524(c)(1)-(2)

Plain Language

Employers face two layered human oversight requirements for discipline, termination, and deactivation decisions. First, an employer may never rely solely on ADS output for these decisions — a human must always be in the loop. Second, when ADS output is the primary basis for such a decision, the employer must assign a human reviewer who affirmatively reviews the ADS output and also compiles and reviews other relevant information such as supervisor evaluations, personnel files, work product, peer reviews, and witness interviews. The 'primarily' threshold is lower than 'solely' — even partial reliance that is the dominant factor triggers the human review obligation. This creates a meaningful human-in-the-loop requirement, not merely a rubber-stamp.

Statutory Text

(c) (1) An employer shall not rely solely on an ADS when making a discipline, termination, or deactivation decision. (2) When an employer relies primarily on ADS output to make a discipline, termination, or deactivation decision, the employer shall use a human reviewer to review the ADS output and compile and review other information that is relevant to the decision, if any. For purposes of this paragraph, "other information" may include, but is not limited to, any of the following: (A) Supervisory or managerial evaluations. (B) Personnel files. (C) Work product of workers. (D) Peer reviews. (E) Witness interviews, that may include relevant online customer reviews.

Other · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1524(d)

Plain Language

Employers may not use customer ratings as the sole or primary data input for an ADS making employment-related decisions. Customer ratings may still be one factor among many but cannot dominate the ADS input. This targets gig economy and service industry platforms where customer ratings are frequently used as primary performance metrics feeding automated employment decisions. It does not ban the use of customer ratings entirely — only their use as the only or primary ADS input.

Statutory Text

(d) An employer shall not use customer ratings as the only or primary input data for an ADS to make employment-related decisions.

D-01 Automated Processing Rights & Data Controls · D-01.1 D-01.2 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1524(e)-(f)

Plain Language

Workers have the right to request a copy of their own data from the most recent 12 months that was primarily used by an ADS to make a discipline, termination, or deactivation decision. This right may be exercised once per 12-month period. When providing worker data, the employer must anonymize any personal information belonging to customers, other workers, or other individuals to protect third-party privacy. The right to access data is tied to the pre-use notice obligation in § 1522(e)(6), which requires employers to describe workers' access and correction rights. This is an on-demand access right, not a proactive disclosure.

Statutory Text

(e) A worker shall have the right to request, and an employer shall provide, a copy of the most recent 12 months of the worker's own data primarily used by an ADS to make a discipline, termination, or deactivation decision. A worker is limited to one request every 12 months for a copy of their own data used by an ADS to make a discipline, termination, or deactivation decision. (f) For purposes of safeguarding the privacy rights of consumers, workers, and individuals, when an employer is required to provide worker data pursuant to this part, that worker data shall be provided in a manner that anonymizes the customer's, other worker's, or individual's personal information.

H-01 Human Oversight of Automated Decisions · H-01.1 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1526(a)-(b)

Plain Language

When an employer primarily relied on ADS output to make a discipline, termination, or deactivation decision, the employer must provide a written post-decision notice to the affected worker at the time the worker is informed of the decision. The notice must be plain-language, standalone, in the worker's routine language, and must include: (1) a human contact for more information and data access requests, (2) disclosure that an ADS was used, (3) the worker's right to request a copy of their ADS data, and (4) notice that retaliation is prohibited. This is a post-decision transparency obligation — it provides the worker with information needed to understand and potentially challenge the decision. The trigger is 'primarily relied on,' meaning it only applies when ADS output was the dominant factor, not merely one of several inputs.

Statutory Text

(a) An employer that primarily relied on an ADS to make a discipline, termination, or deactivation decision shall provide the affected worker with a written notice at the time the employer informs the worker of the decision. The notice shall be all of the following: (1) Written in plain language as a separate, stand-alone communication. (2) In the language in which routine communications and other information are provided to workers. (3) Provided via a simple and easy-to-use method, including an email, hyperlink, or other written format. (b) A notice issued pursuant to subdivision (a) shall contain all of the following information: (1) The human to contact for more information about the decision and the ability to request a copy of the worker's own worker data relied on in the decision. (2) That the employer used an ADS to assist the employer in one or more discipline, termination, or deactivation decisions with respect to the worker. (3) That the worker has the right to request a copy of the worker's data used by the ADS. (4) That the employer is prohibited from retaliating against the worker for exercising their rights under this part.

G-03 Whistleblower & Anti-Retaliation Protections · G-03.3 · Deployer · EmploymentAutomated Decisionmaking

Lab. Code § 1530

Plain Language

Employers are prohibited from retaliating against workers in any way — including discharge, demotion, suspension, or discrimination — for exercising any right under this part. Protected activities include using or attempting to use ADS-related rights (data access, correction), filing complaints with the Labor Commissioner, cooperating in investigations, or assisting in enforcement. This is a broad anti-retaliation provision that covers both internal exercise of rights and external enforcement cooperation.

Statutory Text

An employer shall not discharge, threaten to discharge, demote, suspend, or in any manner discriminate or retaliate against any worker for using or attempting to use their rights under this part, filing a complaint with the Labor Commissioner, alleging a violation of this part, cooperating in an investigation or prosecution of an alleged violation of this part, or any action taken by the worker to invoke or assist in any manner the enforcement of this part, or for exercising or attempting to exercise any right protected under this part.

Other · EmploymentAutomated Decisionmaking

Lab. Code § 1532(a)-(d)

Plain Language

This provision establishes enforcement authority and remedies. The Labor Commissioner enforces the statute through investigations, citations, and civil actions using existing procedural frameworks. Public prosecutors may alternatively enforce. In civil actions, petitioners may seek injunctive relief, punitive damages, and attorney's fees. A $500 civil penalty applies per violation. This creates no new compliance obligation — it is the enforcement mechanism for obligations imposed elsewhere in the statute.

Statutory Text

(a) The Labor Commissioner shall enforce this part, including investigating an alleged violation, and ordering appropriate temporary relief to mitigate a violation or maintain the status quo pending the completion of a full investigation or hearing through the procedures set forth in Section 98.3, 98.7, 98.74, or 1197.1, including issuing a citation against an employer who violates this part and filing a civil action. If a citation is issued, the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the Labor Commissioner shall be the same as those set out in Section 98.74 or 1197.1, as applicable. (b) This part may also alternatively be enforced by a public prosecutor pursuant to Chapter 8 (commencing with Section 180) of Division 1. (c) In any civil action brought pursuant to paragraph (a) or (b) in superior court in any county wherein the violation in question is alleged to have occurred, or wherein the person resides or transacts business, the petitioner may seek appropriate temporary or preliminary injunctive relief, including punitive damages, and reasonable attorney's fees and costs as part of the costs of any such action for damages. (d) An employer who violates this part shall be subject to a civil penalty of five hundred dollars ($500).

Other · EmploymentAutomated Decisionmaking

Lab. Code § 1534

Plain Language

This savings clause preserves local government authority to adopt ADS-related worker protections that are equal to or greater than those in this state law. It creates no new compliance obligation — employers must comply with both state and any applicable local ordinances, with local ordinances prevailing where they provide greater protection.

Statutory Text

This part does not preempt any city, county, or city and county ordinance that provides equal or greater protection to workers who are covered by this part.

Other · EmploymentAutomated Decisionmaking

Lab. Code §§ 1536–1537

Plain Language

Employers who comply with the notice requirements in this part are not required to also comply with substantially similar ADS notice requirements under other state laws — a safe harbor against duplicative state-level notice obligations. However, this safe harbor does not apply to CCPA/CPRA obligations: employers subject to the CCPA must still comply with any automated decisionmaking regulations adopted by the California Privacy Protection Agency. This creates no independent obligation — it coordinates this statute with existing and future California privacy law.

Statutory Text

Except as set forth in Section 1537, an employer who complies with the requirements related to notice under this part is not required to comply with any substantially similar notice provisions related to automated decision systems used for employment-related decisions required under any other state law. Notwithstanding Section 1536, an employer that is a business subject to the California Consumer Privacy Act of 2018 (Title 1.81.5 (commencing with Section 1798.100) of Part 4 of Division 3 of the Civil Code) is subject to any privacy-related automated decisionmaking technology regulation duly adopted by the California Privacy Protection Agency pursuant to Section 1798.185 and subdivision (b) of Section 1798.199.40 of the Civil Code.

Other · EmploymentAutomated Decisionmaking

Lab. Code § 1538

Plain Language

The statute does not apply to employers and workers covered by a collective bargaining agreement that meets three conditions: (1) it explicitly waives this part in clear and unambiguous terms, (2) it expressly covers wages, working conditions, and terms of work, and (3) it provides protection from algorithmic management. All three conditions must be satisfied — a general CBA without specific algorithmic management protections does not qualify. This exemption creates no new obligation; it narrows the statute's scope.

Statutory Text

The provisions of this part shall not apply to parties covered by a collective bargaining agreement if the agreement explicitly waives this part in clear and unambiguous terms, expressly provides for the wages or earning, working conditions, and other terms and conditions of work, and provides protection from algorithmic management.

Other · EmploymentAutomated Decisionmaking

Lab. Code § 1539

Plain Language

Employers are not required to violate federal government contract or regulatory requirements to comply with this statute. If a federal contract or regulation requires an employer to use an ADS in a manner that would otherwise conflict with this part, the employer may comply with the federal requirement. This is a conflict-of-law savings clause, not an independent obligation.

Statutory Text

This part does not prohibit any employer from complying with regulatory or contractual requirements in the provision of products or services to the federal government.